Picture for illustrative purposes only. ARCHIVE

The Ministry of Human Resources and Emiratisation (MoHRE) has called on UAE employers to adopt the voluntary “Savings Scheme” as an alternative to traditional end-of-service benefits, emphasizing its potential to improve the UAE's competitive business environment. The scheme enables employees to build and grow their savings through investment, benefiting from accredited funds. MoHRE’s new initiative provides private-sector workers a secure means of growing their end-of-service benefits through reliable investment funds, as approved by MoHRE and the Securities and Commodities Authority (SCA). Employers can apply through the ministry’s channels to enroll workers in the scheme, choosing from a selection of accredited investment funds. The system allows employers to manage long-term financial obligations effectively, offering a lower-cost alternative to traditional gratuity payments that rely on an employee’s final basic salary. For workers, it presents an opportunity to build assets through optional additional contributions, allowing them to make withdrawals under certain terms. The Ministry provides extensive information on accredited investment funds and registration requirements on its website, www.mohre.gov.ae.

What is the Savings Scheme?

It is a voluntary scheme through which end-of-service benefits of employees are invested in well-proven investment funds with good record.  The scheme aims to provide investment returns to employees on their end-of-service benefits.

How to sign up for Savings Scheme?

The employer submits a request to MOHRE, then chooses an approved investment fund. They need to choose the employees they wish to register in the scheme, while ensuring their employees’ entitlements from the previous period (as per the Labour Law) are preserved.

Benefits of the Savings Scheme for employers

The scheme boosts ease-of-doing business in the UAE by offering investment options that provide end-of-service investment returns to employees. Enrolling in the Savings Scheme costs less on the medium term in comparison with the current end-of-service scheme.

Benefits of the Savings Scheme for employees

Skilled workers can increase their end-of-service benefits if they choose high-return investment funds. Same applies if a UAE national or a resident chooses a voluntary subscription. The voluntary subscription offers employees  the opportunity to keep investing their entitlements even after leaving their jobs. ICA/Expat Media
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